I feel so privileged to bring you a post to detail out the lessons from my first year of semi-retirement. To be in this position at 34 is something difficult to put into words. While I originally left my 9 to 5 public service job for a sabbatical back in January 2021, considering the need for a few months to adjust to this new life, it truly feels like September 2021 to August 2022 was my actual first year of semi-retirement.
My business which serves to cover my share of our family’s cost of living (or up to half of it if I am deciding to withdraw from my investments to cover the rest, as I’ve done in 2021) has been designed in a way that follows the school calendar. I get to slow down my operations to spend the summer with my family, a time where I focus only on the clients I’d been working with prior to June.
As such, with the beginning of a new school year upon us, I’ve found myself reflecting on how this first year unfolded. I’m happy to share the lessons I’ve learned from my first year of semi-retirement with you in this post. But first, for those who are new to this blog and my story, let me briefly detail out the background around how I chose to leave work. I’ll then share a few of the logistics sides of things of the past year as such things have greatly influenced how this year unfolded.
In January 2021, I embarked on what was to be a one year sabbatical to test out Coast-Fi. When I made that decision, we had reached over 80% of our joint FI objective and I had reached 68% of my individual FI objective. I felt confident that aiming to cover my cost of living by running my business part time while letting my investments continue to compound would be the ideal option to continue aiming for FI all while adding more quality to our life in the present.
Since then, I’ve realized I had a much greater desire for a semi-retired lifestyle. Meaning I could scale down on my business and withdraw up to 2% of my investments to cover part of my cost of living for the year. Furthermore, our family’s finances were at a point where they could support this without compromising reaching FI way before traditional retirement age. As such, about half-way through my sabbatical, I decided to scale down my objectives for my business and enjoy a guiltless summer with my family.
By the Fall, with my real world data on how the first 8 months after leaving my secure and stable job had looked like for both my finances and my business, I came to the decision that I was ready to officially leave my 9 to 5. I would continue on this journey as a semi-retiree. Technically, my last day would be in January 2022, when I was to return to work after my 1 year of sabbatical.
Since then, I’ve continued to build up my financial coaching and education business. I generate income through one on one financial coaching, some group courses, speaking engagements and the occasional affiliate income. This is a true labor of love and passion which I had done as a hobby long before generating any income. It’s work that has led me to serve people that I admire and deeply want to support in reaching their objectives and dreams which brings me so much joy and satisfaction. Such an improvement from my previous 9 to 5 which felt just okay!
Special Logistics of This Year
This being the official year of leaving my public service employment, it was time to make the final decision on what to do with my determined benefit pension plan. I opted to transfer out my pension and got through the loads of paperwork to break free from the golden handcuffs. I’ve since invested the proceeds myself on a self-directed basis (part in a Locked In Retirement Account & part paid out to me while being subject to income tax).
This process was awful. Mainly because it took several weeks of waiting and then by the time they transferred out the amount, the economic circumstances made it so that the original estimate of the amount that was to be transferred to me ended up being way higher than the actual funds I received. My transfer value was thus 22% less than that estimate.
Tied to how the market has been performing this past year, I find myself today at about 45% of my individual FI objective. Quite a variation from the 68% I had estimated back when I made my decision to leave my 9 to 5.
Finally, as the Covid-19 pandemic is not over, it’s also been a year where I’ve needed plenty of flexibility to manage isolation periods, occasional periods of online schooling and dealing with repercussions of the dreaded virus making its way into our home not once but twice. I consider that this has significantly impacted the time and attention I can give my business
Do I regret my decision now that I find myself farther from FI?
The quick answer to this is that no, I don’t regret the decision of leaving my cushy 9 to 5 job. You’ll find more qualitative reasons as to why I don’t regret it in the rest of this post but from a purely mathematical standpoint, I’m forever thankful to have built plenty of contingency plans before making this decision!
I’ve planned for the potential worst case scenarios. With the current state of the economy, you might think this would be what we have lived this past year, but let me reassure you that my tendencies towards anxiety have allowed me to imagine much worse scenarios which I’ve thankfully planned for.
It’s important to note that having a paid off home as well as a business which I can scale up and a partner that is still working (despite being much closer to FIRE than myself) are hugely reassuring factors in a period that would be triggering for even the highest of optimists.
Furthermore, I know that as my kids get older, they will not need me as much and the demand for flexibility on my part will reduce (all the more so knowing my partner intends to FIRE in the next few years). As such, I’ll have more available time & energy for additional clients and to build some income generating projects for my business in the future.
That being said, I’ve still regularly had to put in efforts to overcome my scarcity mindset tendencies to make sure that I don’t let unfounded financial worries torment me. But the fact that I am still past the point of Coast-FI and that I’ve got many levels of options before even having to think about returning to a 9 to 5 is quite reassuring.
Now with the background and special logistics of this past year detailed above, let’s get into the lessons I’ve learned from my first year of semi-retirement!
The lessons from my first year of semi-retirement:
You’re never 100% sure of the right next step
One thing that is 100% certain, is that doubts show up no matter where you are. Confidence ebbs and flows. One day you might feel super certain about your next steps and have all the rational reasoning set in stone as to why it makes sense to do this, then the next you might question every single action you take.
If I would have made decisions based on how anxious I feel about the “what ifs”, I’d likely be continuing to pursue full FIRE and then go on to do several one more years of employment after reaching that goal. Sure I would have ended up with way more money than myself and even my kids could ever want in our lifetimes. I’d never need to adapt my budget to the fluctuations of the market or take on some paid work of any form once I would leave my job. But, I would spend several years in a job where I felt less than fulfilled which would take time away from the things I love.
Instead, what I did was reflect on the fears that were pushing me to stay in an employment that paid very well yet felt just okay. That job had a schedule and demands that made me feel like I had very little space and energy left for the rest of my life. You know, the important stuff like my kids, time with other loved ones, my passions, my health, adventures and all of that.
I then reflected on what strategies I could put in place to make a big change while bulletproofing my plan from those fears. Then I committed to the next step. And I’ve since continued to come back to this strategy of working through my limiting beliefs and establishing my next steps according to my current reality.
Does that mean I never doubt my next step? Absolutely not. On days where my confidence is nowhere to be found, I sometimes ask myself what the hell am I doing. But then I calm down, go back to the strategies I know work, review my plans and remind myself of my why.
It’s normal to have limiting beliefs. Rich people have them. Successful people have them. This first year of semi-retirement has led me to bigger rewards than I could have imagined, but it wasn’t a 100% level of confidence on the right next step that got me there. It was through deliberate and intentional efforts to overcome my limiting beliefs and make decisions based on reality. My first year of semi-retirement taught me that doubt should never be in the driver’s seat.
Happiness is weird
Similarly to having doubts show up one day despite having felt full confidence the previous day, happiness levels can follow a weird trajectory. It also surprisingly often requires taking action that doesn’t make you happy at all in the moment to feel longer lasting happiness.
One big example of this has been my commitment to improving my health. Over the last year, I’ve focused my attention on my health in a way that has been very different from when I had a 9 to 5. I had hit a wall where my weight had hit an all time high, my energy was quite low, I got sick often and despite doing the right things with my nutrition and exercising, I wasn’t making any progress.
So I decided to talk to health professionals about this. Through lots of effort and research, I finally found a Naturopath Doctor who was able to identify what might be contributing to my struggles (in short these can be summarized as some hormonal imbalances, food intolerances and low iron). I put in place various changes to make progress. I had to address gut issues through an elimination diet for several weeks. I began tracking a bunch of things in my life.
All of this made me miserable many times. But as the months went by, I started to feel different. The weight began to fall off and, most importantly, my energy levels improved drastically. This miserable process brought on many moments where I could feel happy because I now had more energy to do the things I love.
It seems to me like many of the things that might make us happy in the short term can lead to making us more miserable in the long term. TAlcohol is a very good example, when an evening with a few good beers can be pleasant but with excess, can become quite unpleasant in the long run. A spending spree, especially if you are already in debt, can also have the same effect! A momentary happiness for which one must pay afterwards.
But does that mean that to be happy you should never spend on something you want just for the short term joy it will bring you? Or that you should never have a glass of wine with friends? (in the case where you’ve done well with moderating your alcohol consumption)
To me, happiness is about balancing out those short term joys with the longer term ones that require delayed gratification. It takes effort, mindfulness and practice to be happy. And what makes you happy in this period of your life, might not bring you any joy a few years from now.
One thing’s for sure though, having more time in my life as a semi-retiree sure has contributed to increasing my level of happiness. Mostly because I have chosen to allocate some of that extra time on putting in efforts to reflect and take action on what has an impact on my happiness.
Doing work that fits your values is life-giving:
There’s something truly special about doing work that fits your values. While there is still some hard work involved and tasks I enjoy less in order for me to successfully run my business, the fact that I am working towards a vision I believe in is absolutely life-giving. I feel energized by the work I get to do.
Just this shift in perspective in how I phrased that above is a game changer : I get to do this work. It truly is how I feel when I have a session coming up with a client. It feels like a privilege to be considered a team member supporting someone to reach their financial objectives. Sharing my knowledge and the experience I’ve gained through hundreds of hours of coaching clients with their finances, a subject I love, all while focusing on someone’s deep goals and desires simply fills me with energy.
When the kids returned to school, I had so many ideas floating in my head about how I wanted to get back into projects for the business. You’d think that after a summer of working no more than 5 to 6 hours per week at the most would give me a huge case of the Sunday scaries. That was far from the case! The only negative was an overwhelm at where to start with all these ideas.
You can make money and change the world
Even though I felt that I previously understood this at some level, my first year of semi-retirement was a confirmation that you can earn money and make a difference.
Since launching this blog, I’ve struggled with what feels like an ethical way to earn money from these endeavors. However, shifting fully into the entrepreneur life allowed me to see the value my work can bring to others and validate that being rightfully compensated for it increases the benefits to my audience and clients.
I got to document the time and efforts I put into my work more thoroughly. I further accounted for the time required to continue learning and improving the value I bring to others. More importantly, I was able to see the impact on my clients lives when I am fully focused and dedicated to this work.
Essentially, I’ve learned that you can make money and change the world. I’ve changed my world and that of my family, I’ve changed my clients’ lives and I’ve inspired other people, some new to this idea of FI, to dig deeper in their own beliefs on how to approach the path to reaching their financial objectives. Being able to generate an income from all of this allowed me to give this work the attention needed to make a sustainable and continued difference.
Entrepreneurship requires plenty of courage
Now to balance out the rosy picture I’ve painted above about doing work you love, I can’t tell you enough how happy I am to be pursuing entrepreneurship through a secure financial position. Another lesson from my first year of semi-retirement is that entrepreneurship requires plenty of courage. I admire people who have started out their careers as business owners or who have made the leap into entrepreneurship quite early in their journey.
The comfort and lower stress I get from the financial security I’d built up before taking the leap as an entrepreneur is such a welcomed safety net. I can say no to projects I feel like these don’t align with the work I want to be doing or if my time is limited, even if these might bring me more money faster. If my business doesn’t meet my income goals, I know that I have contingencies in place and options. I could focus on lowering my spending, launch a different project or choose to take on some part-time paid work to cover my share of our costs for a little while if needed.
All of these options are on the table thanks to where I was on the path to FI before taking the leap to entrepreneurship. Furthermore, we’d established a spending goal that fits not only our basic needs but also our wants in terms of daily treats, travel and renovations.
I believe that having taken the leap sooner in my journey would have resulted in energy spent worrying more about the state of the economy than on creating fun projects to continue growing my business. It would have likely taken away from the courage that is necessary to bring these projects to completion.
There you have it! These were some of the lessons I’ve learned from my first year of semi-retirement. Being semi-retired has allowed me more time to put in the work and efforts to feel happier, to focus on work that energizes me and has a positive impact on the world.
While you’re never 100% sure of the right next step, living your best life takes courage and thorough planning. Striving to get to a place where you feel financially secure to make changes that will get you closer to your ideal life is incredibly worth it. Although you can’t prevent bad events such as market downturns, you can get to a place where you have flexibility and options to minimize their impact on your life.